Apple Wants Trial in iBooks Antitrust Case

If apple is conspiring.
Verizon needs to get sued..

This is a very bad idea.

So if all the battery suppliers conspire to fix their price on batteries, we should sue Radio Shack?

Why would Apple want all their dirty laundry thrown out there for everyone to see?

thejadedmonkey said:

Why would Apple want all their dirty laundry thrown out there for everyone to see?

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Precisely. A company can lose even by winning an antitrust case, and they rarely win. I am hoping this is only a ploy to get the government to alter the settlement terms.

Because it's not "dirty laundry" perhaps?

In this case, Monopolies are designed to hurt competition -- usually meaning that one company exerts undue controll on the market to be able to arbitrarily set pricing for the whole industry based not on competition but on something that benefits the company in question.

Apple's point in all of this is that "competition" in this market is in distribution and quality of product more so than JUST PRICE. In fact, Amazon was stifling honest competition in these area by focusing SOLELY on price which it was arbitrarily placing at LOWER THAN COST in the hopes that customers will buy the "loss leader" e-books and stay to buy a stereo or something of the sort. This was destroying competition in the e-books segment by basturdizing the entire industry to help another unrelated industry.

ON THE MERITS, Apple likely feels that the spirit of the law in the first place is being served better by the publishers setting prices than it was by the "free market" (ie ONLY Amazon) setting prices and destroying the industry in the process.

thejadedmonkey said:

Why would Apple want all their dirty laundry thrown out there for everyone to see?

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If you were accused of crime you didn't commit, would you simply plead guilty (and accept the fine and jail time) just to avoid the publicity?

Anti-Trust law is complicated to begin with. Add in the complications brought about by the development of e-books, and things begin to look a lot less black-and-white than the DoJ would like people to believe. This is about a lot more than just people's "right" (was there ever such a thing?) to get cheap copies of NY Times Bestsellers.

Apple wants a trial because it believes that it didn't orchestrate a conspiracy. Or, to be more legally accurate, it doesn't think the Government can really prove that it did.

A trial will typically be decided by a Jury. What do you think the chances are that you are going to find twelve citizens who buy all of their books as digital downloads for their Kindles? My guess is - pretty much zero.

The TechNerds who make up a big fraction of MR's readership need to understand that not everyone in the world sees things the way they do.

Ok, antitrust laws are not there to protect quality, they are there to protect price.

It is definitely clear in this case that prices increased because of the actions of Apple colluding with the publishers, all agreeing that they will not allow their books to be sold for less than the price set on iBooks.

This would be the same thing as Walmart going to Hasbro and saying, we will sell your board game at an agreed upon price and give you 70% of the sales, but you cannot ever sell the game for less than what we are charging, even if you sell it directly to the customer. Both Walmart and Hasbro would instantly get sued if this happened, yet because Apple is doing it with electronic goods, everyone is defending it.

BigJayhawk said:

Because it's not "dirty laundry" perhaps?

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vrDrew said:

If you were accused of crime you didn't commit, would you simply plead guilty (and accept the fine and jail time) just to avoid the publicity?

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This is naive reasoning on several levels.

First of all, antitrust actions are mainly about the government stopping a behavior that it deems to be illegal, and they are typically resolved administratively by the company agreeing not to do it again. If the company is claiming that they never did the offending thing, then agreeing not to do it again should not be an issue. Arguing this in court is a pointless exercise.

Second, these trials can drag on for years, during which a lot of material that the company really would prefer to remain confidential becomes very public. Some of it will no doubt be embarrassing.

Third, the moment the trial opens, media coverage for the company changes utterly. The message is no longer about their new and wonderful products, but about this week's developments in the antitrust trial. We will never be given a chance to forget that Apple is being hoisted up on antitrust charges, and the public will be constantly reminded about how big and possibly arrogant and out of control Apple has become. In short, a PR nightmare, squared.

Finally, if the case ever proceeds to a Finding of Fact, then Apple become vulnerable to all sorts of private actions.

Going into court, guns blazing, with some misguided mission to "preserve your honor" is a fool's errand. The smart company makes it go away as quickly and quietly as possible.

All of this Microsoft discovered the hard way. I hope Apple is smart enough to not repeat their mistakes.

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cmwade77 said:

Ok, antitrust laws are not there to protect quality, they are there to protect price.

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They protect neither. They protect competition.

thejadedmonkey said:

Why would Apple want all their dirty laundry thrown out there for everyone to see?

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They obviously know they can win.

If you think they haven't considered their position extremely carefully (this is Tim Cook and his legal department we're talking about) then you don't know Apple. This is the same Apple that hoisted MS over a barrel with Quicktime litigation and extracted over $100 million out of them when the dust settled.

Apple is *very* experienced in the litigation game. Sit back and watch how it's done.

*LTD* said:

They obviously know they can win.

If you think they haven't considered their position extremely carefully (this is Tim Cook and his legal department we're talking about) then you don't know Apple. This is the same Apple that hoisted MS over a barrel with Quicktime litigation and extracted over $100 million out of them when the dust settled.

Apple is *very* experienced in the litigation game. Sit back and watch how it's done.

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as pointed out before the money is not the dirty laundry. Others have pointed out multiple times this becomes a PR nightmare no matter what the result is.

If it goes to trail Apple will only be on losing no matter what the results are of the trail. (Losing in terms of PR and tons of information they do not want public made VERY VERY public)

*LTD* said:

They obviously know they can win.

If you think they haven't considered their position extremely carefully (this is Tim Cook and his legal department we're talking about) then you don't know Apple. This is the same Apple that hoisted MS over a barrel with Quicktime litigation and extracted over $100 million out of them when the dust settled.

Apple is *very* experienced in the litigation game. Sit back and watch how it's done.

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You mean like how they've made zero progress in Jobs' "thermonuclear war" against Android? Actually, scratch that - negative progress considering that they've only managed to invalidate their own patents.

Apple will win.
I hope they counter sue, but they probably won't for the sake of their public image.

vrDrew said:

If you were accused of crime you didn't commit, would you simply plead guilty (and accept the fine and jail time) just to avoid the publicity?

Anti-Trust law is complicated to begin with. Add in the complications brought about by the development of e-books, and things begin to look a lot less black-and-white than the DoJ would like people to believe. This is about a lot more than just people's "right" (was there ever such a thing?) to get cheap copies of NY Times Bestsellers.

Apple wants a trial because it believes that it didn't orchestrate a conspiracy. Or, to be more legally accurate, it doesn't think the Government can really prove that it did.

A trial will typically be decided by a Jury. What do you think the chances are that you are going to find twelve citizens who buy all of their books as digital downloads for their Kindles? My guess is - pretty much zero.

The TechNerds who make up a big fraction of MR's readership need to understand that not everyone in the world sees things the way they do.

Click to expand...

You a person is accused of crime they faces the lose of their freedom or even their life. Civil suits are only about money, Apple has ten's of BILLIONS in cash. Either way this doesn't impact them short term unless they have expose too much internal information to the public, then it only hurts/

IJ Reilly said:

This is naive reasoning on several levels.

First of all, antitrust actions are mainly about the government stopping a behavior that it deems to be illegal, and they are typically resolved administratively by the company agreeing not to do it again. If the company is claiming that they never did the offending thing, then agreeing not to do it again should not be an issue. Arguing this in court is a pointless exercise.

Second, these trials can drag on for years, during which a lot of material that the company really would prefer to remain confidential becomes very public. Some of it will no doubt be embarrassing.

Third, the moment the trial opens, media coverage for the company changes utterly. The message is no longer about their new and wonderful products, but about this week's developments in the antitrust trial. We will never be given a chance to forget that Apple is being hoisted up on antitrust charges, and the public will be constantly reminded about how big and possibly arrogant and out of control Apple has become. In short, a PR nightmare, squared.

Finally, if the case ever proceeds to a Finding of Fact, then Apple become vulnerable to all sorts of private actions.

Going into court, guns blazing, with some misguided mission to "preserve your honor" is a fool's errand. The smart company makes it go away as quickly and quietly as possible.

All of this Microsoft discovered the hard way. I hope Apple is smart enough to not repeat their mistakes.

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They protect neither. They protect competition.

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LOL what are you talking about? This is NOT Microsoftian antitrust in nature. It's over . . . . e-book pricing. *yawn*

This will register with the public like Question Period in the House of Commons.

They want iPads, and MORE Apple gear. More and more of it, and to the tune of billions of dollars' worth of open wallets.

It's The Great e-book Trial. It's positively comedic. LOL Joe Average won't give a damn. If he doesn't give a damn about alleged (though hugely sensationalized and thoroughly reported) Foxconn worker abuse, he won't care about piddly e-book pricing.

Get real. This isn't Microsoft antitrust. We live in an age where consumers are falling all over themselves to get Apple gear. It'll take wrongdoing of MASSIVE proportions for little Johnny next door, or so and so's wife, or the current Fortune 500 company rolling out iPads, to think twice about their planned Apple purchases.

If Apple can weather the Foxconn "dirty laundry" with barely a scratch - most consumers didn't even care to notice, it was ALL about the New iPad and iPhone 5 rumours - then chances are, they'll be just fine with the rest of their laundry. Remember, it's TIM COOK running Apple. it's safe to say he runs a very tight ship. They're prepared.

Really now, what "dirty laundry" will the world find out and stand in awe over? That Apple kills puppies? That they're running a prostitution ring? LMAO, truly. There was even that Stock Options "scandal." Apparently that was supposed to be serious. It barely registered with anyone.

Most of the lovable geeks and tech-heads hanging out on tech sites on the ass-end of the net understand tech very well. Chips and circuits and Terminal commands, and moaning about Mission Control, and wielding their sacred photoshopped mockups in fake iPhone rumour battles (LOL.) It's PEOPLE they have a problem with. Consumer Behaviour 101. Check it.

First, let me say, I like Amazon. I read several Kindle books a week. My mother is one of the top ranked Amazon reviewers. That said, all the dirty laundry is on Amazon's side. This is much like Wal-mart accusing a small M&P store of monopolistic practices, because, they won't give up and close down shop.

Amazon is running the brick and mortar bookstores out of existence by pricing the products they sell, below their cost. Predatory pricing, with the intent to destroy your competition is a crime. Amazon is driving the cost of books so low, it is running the publishing companies out of business, greatly reducing the quality of editing in books. (Editing is as important to the quality of a book as writing. It is more so for new authors.)

If Amazon is not stopped, they will soon be the only book store and the only publishing house. That is not healthy competition.

Mac Blog?

Why is this in the Mac Blog? iBooks are only for iOS.

When the government is doing a prosecution for entirely political purposes, the only outlet available is a jury trial.

Remember prohibition? Oh, wait, we still have it. Different substance these days.

Rocketman

IJ Reilly said:

First of all, antitrust actions are mainly about the government stopping a behavior that it deems to be illegal, and they are typically resolved administratively by the company agreeing not to do it again. If the company is claiming that they never did the offending thing, then agreeing not to do it again should not be an issue. Arguing this in court is a pointless exercise.

Click to expand...

If the Government had offered Apple a settlement that merely required them to agree to never again illegally conspire to fix prices (something Apple has said they didn't do in the first place) - then Apple would have settled.

But that obviously wasn't the case.

Apple believes, apparently with considerable justification, that their actions in regard to the e-book market were not only in line with the spirit of Anti-trust Law, but with the Letter of it too.

Apple is not prepared, even though it has the financial resources to do so, to simply "buy" marketshare in the e-reader marketplace. It could, should it choose to, easily spend a couple of billion dollars subsidizing New York Times Bestsellers even more than Amazon does. Essentially killing off any hope Amazon ever had of seeing a profit from its Kindle business.

Such an action would - with some justification - be called "anti-competitive." But why is it that when Amazon does exactly the same thing - selling Bestsellers at a loss, in order to boost sales of its competing Kindle device - then somehow you manage to see Apple as the bad guy?

How exactly can you collude to fix prices when most of the books are only offered through one publisher?

Rocketman said:

When the government is doing a prosecution for entirely political purposes, the only outlet available is a jury trial.

Remember prohibition? Oh, wait, we still have it. Different substance these days.

Rocketman

Click to expand...

Do you care to give even a basic outline these "political purposes" you allude to, or did it just sound like a smart idea in your head?

The DOJ has a stated goal of winning 90% of criminal cases and 80% of civil cases, and they beat it every year. They don't go on random boondoggles.

vrDrew said:

If the Government had offered Apple a settlement that merely required them to agree to never again illegally conspire to fix prices (something Apple has said they didn't do in the first place) - then Apple would have settled.

But that obviously wasn't the case.

Apple believes, apparently with considerable justification, that their actions in regard to the e-book market were not only in line with the spirit of Anti-trust Law, but with the Letter of it too.

Click to expand...

Possible, but not certain, and not obvious. The publishers who settled paid a fine, and it is likely that the DoJ is after the same from Apple and the holdout publishers. What Apple is after here is unclear. As they have to understand the risks of going to trial, I would guess they are after some sort of better settlement terms. They have nothing else of substance to gain.

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ShiftyPig said:

Do you care to give even a basic outline these "political purposes" you allude to, or did it just sound like a smart idea in your head?

The DOJ has a stated goal of winning 90% of criminal cases and 80% of civil cases, and they beat it every year. They don't go on random boondoggles.

Click to expand...

He is ideologically opposed to antitrust laws. I suppose once you have decided that the laws themselves are wrong, it would be difficult to imagine how they could be fairly implemented.

Sweet!

Awesome! You go Apple! Stand up to the man! Fight that competition-limiting DOJ! Obliterate the notion that total profits can be raised by raising the price above the maximum-profit point! Demonstrate the important role that (effective) monopolies (like Amazon's Kindle market) are what brings the economic incentive for competitors (i.e. you) to enter the market from both the supply and demand side! Protect the rights of copyright holders to set their price! Defeat Obama's evil DOJ! Fight for truth, justice, and the American way!

BigJayhawk said:

Because it's not "dirty laundry" perhaps?

In this case, Monopolies are designed to hurt competition -- usually meaning that one company exerts undue controll on the market to be able to arbitrarily set pricing for the whole industry based not on competition but on something that benefits the company in question.

Apple's point in all of this is that "competition" in this market is in distribution and quality of product more so than JUST PRICE. In fact, Amazon was stifling honest competition in these area by focusing SOLELY on price which it was arbitrarily placing at LOWER THAN COST in the hopes that customers will buy the "loss leader" e-books and stay to buy a stereo or something of the sort. This was destroying competition in the e-books segment by basturdizing the entire industry to help another unrelated industry.

ON THE MERITS, Apple likely feels that the spirit of the law in the first place is being served better by the publishers setting prices than it was by the "free market" (ie ONLY Amazon) setting prices and destroying the industry in the process.

Click to expand...

Yeah, sure, Apple, the corporation with more cash reserves than the entire African continent, is the saint and is only trying to protect us all from the evil competitors. I get it.

On the merits, do you know what Amazon did for ALL authors on this planet? They freed writers from the power of the publishing houses by making them OBSOLETE. Yes, Amazon successfully destroyed the TRADITIONAL publishing industry and replaced it with something MODERN. Amazon did some incredibly great there for the benefit of all writers AND readers.

Yes, this new order totally sucks for the old publishing houses. Just like the invention of mp3 and file sharing sucks for record labels and now even the movie industry.

Technology has evolved, their business models haven't. The process is called selection - either adept or become extinct.

Anyway. In your next lesson, you Apple's business model is better for consumers than Amazon's. At least Amazon gives me a free choice on which platform I want to read my eBooks - they don't care whether it's an iOS gadget, an Android or a Windows device, their Kindle readers or even a web browser using read.amazon.com. They also give their authors the choice whether they want to publish free of DRM or with DRM.

Apple only lets me read on iOS gadgets. They don't even support their own OS X platform. They try to get exclusive content by adding dubious licensing conditions to their iBooks Author software.

What again were the merits of Apple's offerings?